Walmart has agreed to pay about $100 million to settle claims that it misled delivery drivers about how much money they could make through its Spark Driver program, according to the Federal Trade Commission and a group of 11 states. The government says Walmart showed drivers inflated base pay and tip amounts, and in some cases promised that all tips would go to drivers, even though that was not true.
The FTC filed its complaint in federal court in California, saying the misleading earnings claims hurt drivers who choose delivery work based on what they think they can earn. As part of the agreement, Walmart will stop providing misleading information about potential pay and must make future earnings clearer to drivers. Walmart said it has already issued payments to many drivers and will continue to correct pay issues.
The Spark Driver program, launched in 2018, has become an important piece of Walmart’s last-mile delivery business, helping bring online orders directly to customers’ doors. The settlement includes payouts for more than a million drivers who used the app. In Illinois alone, drivers will share more than $1 million, and other states are receiving funds as part of the deal.
Illinois Attorney General Kwame Raoul, one of the state leaders involved in the case, said the settlement shows a need to protect gig workers. “We must make sure people are paid what they were promised,” Raoul said, noting customer tips should go to the workers who do the jobs.
The FTC also said this sort of enforcement is aimed at making labor markets fairer. “Labor markets cannot function efficiently without truthful and non-misleading information about earnings and other material terms,” said Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection. “Today’s settlement reflects the FTC’s focus on ensuring a healthy labor market for American workers.”
The settlement requires Walmart to clearly disclose how drivers are paid and ensure that tips are passed on as promised. The company did not admit wrongdoing as part of the agreement.
The case is one of the largest enforcement actions tied to gig delivery pay practices. For retailers that rely on app-based drivers to power same-day and grocery delivery, it puts renewed focus on how earnings are presented inside delivery platforms.
